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Breaking: Celsius Paid Off Maker Loan, Moves Funds In Single Wallet

coingape.com 07 July 2022 11:11, UTC
Reading time: ~2 m

Crypto lender Celsius has paid off its Maker loan completely. Celsius has paid the 41.23 million DAI debt and withdrawn 21,962.63 wBTC collateral worth $450 million. Interestingly, most of the funds are now in a single wallet, which some think is a pre-bankruptcy consolidation of funds. However, some see it as an opportunity for CEL token short squeeze.

Is Celsius Getting Ready for Bankruptcy

Celsius on July 7 has closed its outstanding Maker loan of 41.23 million DAI and received 21,962 wBTC worth $450 million in collateral back in Bitcoin. The company had been actively paying off its debt daily this week.

As reported earlier, Celsius’ multi-collateral DAI vault 25977 had an outstanding debt of 41.23 million DAI. The wBTC liquidation price fell to $2,722.11 after it paid off almost $180 million of Maker loan in July.

After clearing its Maker loan, Celsius is left with Compound and Aave loans of nearly $258 million. In fact, the company has repaid 8.76 million in DAI to Aave in a recent transaction.

According to Zapper.fi, the Celsius Wallets Combined has a net worth of around $2 billion. Out of which, the wallet address (0x8aceab8167c80cb8b3de7fa6228b889bb1130ee8) having a net worth of $1.14 billion, which contains most tokens.

Many experts, including DeFiyst, believe the consolidation of funds in a single wallet is a pre-bankruptcy move. Interestingly, this excludes CEL and staked ETH (stETH).

“If it’s not sold and is moved to FTX, ppl will frontrun the flow and they’ll get a worse price. As @SplitCapital mentioned, the flow will work its way through if sold OTC regardless in that size.”

Celsius has around $384 million worth of Ethereum (ETH) tokens staked. If the funds go to the Aave position as collateral, Celsius would have enough to withdraw all stETH.

Currently, the company may be executing a transaction with $500 million worth of wBTC on FTX.

Meanwhile, Simon Dixon, CEO of BnkToTheFuture, warned in a tweet:

“I add that the Celsius Network community will need to apply pressure to prevent crypto assets being sold in Chapter 11 like we did in Mt. Gox. If not depositors lose & cheap Bitcoin will be scooped up at the cost of innocent misled investors. Let’s prevent that #DepositorsFirst.”

CEL Token Short Squeeze

Celsius’ CEL token witnessed a short squeeze after the Maker loan repayment. The CEL price jumped from $0.84 to $0.91 within an hour. The price was again dumped to 0.84 by short-sellers. On average, 60% of short positions were witnessed across exchanges.

Meanwhile, rumors of The CelShortSqueeze community coming together with WallStreetBets are circulating to get the biggest squeeze in crypto history.

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